People are furious that the GOP tax bill has a break for private jet owners — but it's not what it seems

People are pointing with anger to a provision in the
Senate tax bill passed on Saturday that appears to give private
jet owners a tax break.

The change is actually a technical clarification that
prevents operators of private charter flights from being hit
with a tax designed for commercial flights.

Democratic Sen. Sherrod Brown earlier this year
introduced a bill with similar language to the changes in the
GOP tax bill.

As the American public digests the passage of the Republican tax
bill in the Senate, one provision of the bill has seen particular
derision Saturday morning.

Opponents of the bill, the Tax Cuts and Jobs Act (TCJA), are
pointing to a provision they say gives a tax break to private jet
owners.

"Middle class families all over America finally get the tax
relief they've been pleading for regarding their private jets,"
tweeted Nick Kristof, the New York Times columnist.

"I can't believe this is real, a tax break for
private jet owners," Roberto Ferdman, a
correspondent at Vice, said in a tweet with more than 15,000
retweets as of Saturday morning.

The change
is actually technical one. The language of the bill
would exempt "aircraft owners" from taxes on the "maintenance and
support of the aircraft owner's aircraft or flights on the
aircraft owner's aircraft."

But its purpose is to prevent private air charter companies
from getting hit with what's known as the "ticket tax" on
flights. The tax was originally designed to apply to commercial
flights, while a separate gas tax applied to "general aviation"
flights like private charters.

Due to some language confusion in the tax code, however,
the IRS began imposing the "ticket tax" on private flights, which
has
caused a long-running battle between operators of the charter
companies and the government. The IRS suspended the assessment of
the tax on aircraft management companies in 2013 due to the lack
of clarity and the agency
dropped a number of audits on these companies in July because
it still did not have updated guidance.

The TCJA language is meant to clarify the discrepancy and
ensure that the ticket tax is not applied to private flights.
According to a letter in 2016 from the Joint Committee on
Taxation, the change would lose less than $500,000 in federal
revenue over 10 years.

In fact, the language is similar to a bill introduced by
Democrat Sen. Sherrod Brown of Ohio and co-sponsored by
Republican Sen. Rob Portman, also from Ohio. Two of the largest
private jet operators (which
are owned by Warren Buffett) are based in Ohio.